Nigeria Oil Production Slumped To 1.08mbpd July – OPEC
Nigeria maintained 14 functional oil production rigs in July, after recording the same number of rig count/units in the preceding month of June 2023, latest data on World Rig Count and Units released by the Organisation of Petroleum Exporting Countries (OPEC) showed.
OPEC, in its August 2023 Monthly Oil Market Report, however, stated that though Nigeria maintained the number of functional rigs across the country, its oil output went southward in July, when compared to what was produced in June.
An oil rig is a structure above an oil well on land or in the sea that has special equipment attached to it for drilling and removing oil from the ground.
In its latest report, OPEC explained that while the average rig count for Nigeria in the fourth quarter of 2022 was 10, the number moved up to 14 in the first quarter of 2023, but dropped to 13 in the second quarter.
It said the functional rigs in Nigeria increased to 14 in June and remained the same in July 2023, but pointed out that oil output from the country crashed last month.
Meanwhile the report outlined the rig counts for other 12 member nations of OPEC, for instance, it put the functional rigs in Algeria in the months of June and July at 36 and 35 respectively, while that of Iran was the highest at 117 in both months.
On the plunge in Nigeria’s crude oil production, OPEC said information sourced through direct communication with Nigeria indicated that the country’s oil output fell from 1.249 million barrels per day in June, to 1.081mbpd in July.
The global oil cartel stated that Nigeria’s oil output in May was 1.184mbpd, before it rose to 1.249mbpd in June, but could not be sustained in July.
This confirmed the report published on Monday, which showed that Nigeria lost about N249bn crude oil revenue in July following the plunge in its oil output by over four million barrels in the same month.
The report revealed that data from the Nigerian Upstream Petroleum Regulatory Commission indicated that while the country’s total oil production in June was 37.5 million barrels, it dropped to 33.5 million barrels in July.
This shows that the country lost about four million barrels of oil between June and July. Pipeline vandalism and crude oil theft have been blamed severally as the reason for the plunge in Nigeria’s oil output.
The President, Petroleum Products Retail Outlets Owners Association of Nigeria, Billy Gillis-Harry, had told our correspondent that the drop in oil output posed a dangerous sign.
“That is a very dangerous signal of trouble that is coming. This is because we thought that with what the Tompolo team is doing, we should be approaching about two million barrels of crude oil production per day.
“So if the volume of reduction per day is this frightening, then it is something that calls for urgent investigation. It portends an economic downturn that could be drastic if the situation continues. However, I believe that with all of these new oil discoveries in Nasarawa and Bauchi, and production commencing, there may be a positive change,” Gillis-Harry stated.
On his part, the Executive Secretary, Major Oil Marketers Association of Nigeria, Clement Isong, called on the Federal Government to work hard and stop crude oil theft.
He said oil theft was not only stopping Nigeria from meeting its production quota as approved by OPEC, but was denying the country a whole lot of dollars required for the imports of goods.
“The I&E (Importers and Exporters) window is illiquid. There’s no money there. To buy products (fuel), it costs you between $25m to $30m. You can’t find it in the I&E window. So it doesn’t work and that is why people are not importing.
“You can’t access the dollar, you can’t find it right now. Nigeria has to sort out the security issues in the Niger Delta so that we can increase our daily crude oil output. If we increase it to 1.8 or two million barrels per day, then there’ll be dollars in the market. So we need to stop oil theft.”
